Miton UK MicroCap Trust plc (LON:MINI) fund managers, Gervais Williams and Martin Turner, provide a portfolio update for November 2021.
Generally, most of the Trust’s portfolio holdings continued to report ongoing progress during November. There has also been an unusually large number of UK listed companies hoping to raise new capital ahead of the end of the year. Indeed, the aggregate scale of the current plc fundraisings is so large that market indigestion has depressed many small and micro-cap company share prices, as some investors sell existing holdings to raise capital to support these.
Alongside, inflation data during November rose more than expected and a new Covid variant led many governments to reimpose various civil restrictions. The US dollar was notably strong during the month, as the current financial stimulus may be scaled back more rapidly than previously anticipated.
Less financial stimulus, and the new civil restrictions led to some weakness in the share prices of global companies during the month. Many mainstream stocks in the UK have a very substantial part of their aggregate earnings in overseas operations however, so the US Dollar strength tended to offset the setback. The share prices of smaller companies were somewhat weaker with the FTSE AIM-All Share Index down 2.80% during November. In comparison, the NAV of the Miton UK MicroCap Trust fell 1.41% over the same period.
The longer term returns of the Miton UK MicroCap Trust remain strong with a NAV total return of 98.21% since issue, which compares with a 71.16% return for the FTSE AIM-All Share Index.